Gov of Colo, on my 2016 Dem short list, seems to be taking on the fracking opponents on the left (like the NY Times) by asserting that the fluid is completely safe. He is such a newcomer that he doesn't even know the name Haliburton is a Democratic swear word.

Colorado Gov. John Hickenlooper went to unusually great lengths to learn firsthand the strides the oil and gas industry has made to minimize environmental harm from fracking.

The first-term Democrat and former Denver mayor told a Senate committee on Tuesday that he actually drank a glass of fracking fluid produced by oilfield services giant Halliburton.

The fluid is made entirely “of ingredients sourced from the food industry,” the company says, making it safe for Mr. Hickenlooper and others to imbibe.

“You can drink it. We did drink it around the table, almost rituallike, in a funny way,” he told the Senate Committee on Energy and Natural Resources. “It was a demonstration. … they’ve invested millions of dollars in what is a benign fluid in every sense.”

Sen. Al Franken, Minnesota Democrat, found humor in the governor’s admission and asked if the experience was part of some bizarre occult practice.

“No, there were no religious overtures,” Mr. Hickenlooper responded.

While some laughed at the governor’s statement, he brought up the incident to make a serious point: that oil and gas companies have taken major steps forward in fracking technology.

The practice uses water, sand and chemicals injected into the ground at tremendous pressure to break apart rock formations and release fuel. Environmental groups and many other critics long have been concerned about the chemicals used in the practice and their potential effect on groundwater.

Mr. Hickenlooper stressed that the Halliburton food additive mixture is so safe, one can literally drink it. He also cautioned against state and federal lawmakers going too far with laws to force companies such as Halliburton to disclose the formulas for such products.

“If we were overzealous in forcing them to disclose what they had created, they wouldn’t bring it into our state,” he said.

The so-called shale gas revolution has changed the face of the energy industry in the United States. Natural gas production in the United States is at an all-time high. Proposals for, and the actual construction of, liquefied natural gas export terminals in the United States have replaced plans for liquefied natural gas import terminals. But shale gas deposits as a proportion of global natural gas supplies may seem minor in comparison to methane hydrates.

Methane hydrates form at a specific range of low temperatures and high pressures. They occur in the Arctic permafrost and along continental slopes, typically at water depths greater than 500 meters (1,640 feet). Once considered only a hindrance to conventional extraction, emerging technologies to tap methane hydrates mean they now have the potential to alter the global energy outlook. Estimates for total methane hydrate gas in place are rough, but range anywhere from 3,000 trillion cubic meters to more than 140,000 trillion cubic meters, the large range illustrating the uncertainty of the estimate. By comparison, combined global technically recoverable conventional natural and shale gas reserves total roughly 640 trillion cubic meters. (In 2011, global natural gas consumption stood at approximately 3.4 trillion cubic meters.)

Despite the promise of methane hydrates, the technology for their extraction is still under development, and potential risks have not been neutralized. These include the uncontrolled release of natural gas formerly trapped in ice, which could result in large amounts of the greenhouse gas methane entering the atmosphere. They also include the possibility of destabilizing the ocean floor, leading to underwater landslides and subsequently the possible sinking of drilling rigs.

Drilling likely will be required to access the natural gas in the hydrates. A number of drilling techniques could be used to destabilize the equilibrium of the hydrates and release natural gas. These include thermal injections, which involve increasing temperatures, often by injecting steam, to dissociate the gas. They also include depressurization, or reducing the pressure of the formation to release the gas. Finally, and perhaps most promising, is carbon dioxide injection. In this process, carbon dioxide essentially replaces the natural gas within the hydrate, allowing for the release of natural gas and the capture of carbon dioxide.

Research programs focused on methane hydrate detection and extraction can be found in numerous nations, including Japan, South Korea, India, China, Norway, the United Kingdom, Germany, the United States, Canada, Russia, New Zealand, Brazil and Chile. Much of the initial research has been highly collaborative, with the government and private companies from the United States playing a prominent role.

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Most of these research programs are in the exploratory, experimental and laboratory phases, with expeditions seeking samples to determine the extent of deposits so as to direct further research. Last year, however, Japan completed a successful field test in Alaska in collaboration with Norway and ConocoPhillips, successfully producing natural gas through controlled dissociation via carbon dioxide injections. In recent weeks, Japan has also begun offshore production tests in the Nankai Trough off the coast of central Honshu.

Despite these recent advances, commercial production is still unlikely for at least 10 to 15 years. Japan believes that commercial production will be possible by 2018, while the U.S. Geological Survey estimates that countries with the "political will" to pursue methane hydrates could see production by around 2025. Though expensive compared to conventional methods of recovering natural gas, the estimated cost of methane hydrate extraction is similar to other unconventional sources, such as shale gas. The International Energy Agency estimates that once developed, it will cost between $4.70-$8.60 to extract 1 million British thermal units of methane hydrates. The same studies estimate conventional costs as low as $0.50 per 1 million British thermal units. Developmental and capital costs are likely to be high, since the deposits are in difficult, harsh locations (e.g., Arctic or deepwater environments) and depending on their location, new fields could also mean additional capital costs from infrastructure development.

Methane hydrates are widely distributed throughout the globe, including locations that do not have substantial conventional natural gas reserves. Deposits have been discovered off the coasts of Japan, India, South Korea and Chile, in the Gulf of Mexico and off the southeastern coast of the United States. Potential reserves also exist in the Arctic permafrost of Alaska, Canada and Russia. Their widespread distribution means traditionally resource-poor countries could now have access to domestic sources of energy.

Methane hydrate estimates throughout Asia are still being determined through further exploration, but initial median estimates place Japan's reserves at 6 trillion cubic meters, China's at 5 trillion cubic meters and India's at 26 trillion cubic meters. Japan was the first nation to establish a methane hydrate program, which it founded in 1995. India formed its national program in 1997, and China and South Korea followed suit later. Since 2006, China, India and South Korea have all led exploratory expeditions that included conducting seismic studies and retrieving core samples to determine the composition of possible reserves.

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Japan continues to lead the field, as shown by its recent offshore production testing. Though technologically advanced, Japan lacks many natural resources and so must import the majority of its energy supply. In 2011, it consumed 123 billion cubic meters of natural gas, of which 117 billion cubic meters were imported. Developing a domestic source of energy could restore some of the energy security lost when Japan ceased the majority of its nuclear power production. Japan's imperative to secure energy supplies combined with its technical capabilities may allow it to push forward despite the high economic cost.

While initial offshore exploration has occurred near the coast, often within a given country's exclusive economic zone, future exploration will likely continue offshore. This exploration could happen in contentious waters, especially in East Asia. As technology continues to advance, a new dimension to pre-existing territorial frictions could emerge as nations switch from competing for potential resources to actual resources. Exploration for this resource is a tool competing nations could use to claim sovereignty over disputed waters. Whether or not the technical hurdles of extracting methane hydrates are overcome, short- and medium-term exploration efforts could help countries in their attempts to establish a presence in international or disputed waters. Japan's lead in the development of methane hydrate extraction could give it an edge in the competition for future resources in the region..

Just bought gas in the heart of the ND oil boom. Prices same as at home. Still need refineries, cars don't run on heavy crude.

Someone please remind again why Dick Cheney should not have had industry experts advise him on how to meet future energy needs and what the his opponents are using in their tanks. Harry Potter broom fuel?

Natural Gas Exports and the Mythical 'Sweet Spot'Congressional meddling so warped the market in 1977 that an emergency law was needed to undo the harm.By J. BENNETT JOHNSTON (former Democratic senator from Louisiana, was chairman of the Senate Committee on Energy and Natural Resources from 1986-94.)

"Which brings us back to today's calls for top-down control of the LNG market. Does anyone really think that Congress or the Department of Energy, years in advance, can predict supply and demand or determine which of the 16 applicants can procure the billions of dollars and decades-long contracts necessary to build an LNG export facility?"

"The free market might not always lead to everyone's definition of the sweet spot, but experience has shown that it is a better allocator and regulator than bureaucrats and politicians. We should heed the admonition of Adam Smith that demand begets supply: Allow the free market to allocate the nation's newfound energy bounty."------Which party would he join now?

The American energy boom is deepening splits within the Organization of the Petroleum Exporting Countries, threatening to drive a wedge between African and Arab members as OPEC grapples with a revolution in the global oil trade.

OPEC members gathering on Friday in Vienna will confront a disagreement over the impact of rising U.S. shale-oil production, with the most vulnerable countries arguing that the group should prepare for production cuts to prop up prices if they fall any lower.

"We are heading toward some problems," said a Persian Gulf OPEC delegate.

African OPEC members such as Algeria and Nigeria—which produce oil of similar grade to shale oil—are suffering the worst effects from the North American oil boom. Nigeria Oil Minister Diezani Alison-Madueke deemed U.S. shale oil a "grave concern."

Gulf countries, notably Saudi Arabia, pass relatively unscathed—and are the only OPEC members with the flexibility to cut production. But they are unlikely to let that happen at Friday's meeting, several OPEC delegates said.

That would deepen power struggles that have dominated the organization in recent years. Iran, Venezuela and Algeria, who need high oil prices to cover domestic spending and offset falling production, have regularly clashed with Gulf countries led by Saudi Arabia, who have the financial strength to withstand lower prices.

More

Heard on the Street: East Coasters Drive Down Gasoline DemandOPEC has overcome past rivalries to rally against an external threat, most notably in 2008 when it agreed to a production cut of more than four million barrels a day to stem a price crash during the financial crisis. But the uneven impact of the North American supply surge makes a collective response—such as a coordinated production cut to support prices—more difficult, said delegates on both sides of the divide.

The U.S. and Canada are set to produce about 21% more oil by 2018 than from this year, according to data from the International Energy Agency.

This marks a historic and largely unexpected reversal. U.S. crude-oil production peaked in 1970 and had declined continuously for more than 20 years when shale oil first began to flow after 2008. U.S. crude production has risen to a 21-year high as hydraulic fracturing, known as fracking, and other technologies have unlocked large resources of oil previously trapped in shale rock in North Dakota and Texas. Shale deposits in other areas, such as Pennsylvania, are yielding mostly natural gas.

OPEC, the source of around one-third of the world's oil, has clearly been taken aback by the shift in U.S. production. In 2010, the organization forecast U.S. and Canadian oil production of 2014 at 11.8 million barrels a day. Just two years later, that forecast had risen to 14.5 million barrels a day.

A rebound in U.S. production would have been unexpected just five years ago because shale oil production requires an oil price that has rarely proved sustainable—typically $70 a barrel or above. But oil prices have remained much higher in the past two years, thanks in part to persistent geopolitical tensions in OPEC producers, such as the Libyan civil war and Persian Gulf tensions.

As U.S. production has grown, exports to the U.S. from three of OPEC's African members, Nigeria, Algeria and Angola, have fallen to their lowest levels in decades, dropping 41% in 2012 from 2011, largely because of shale oil, according to the U.S. Department of Energy. In contrast, Saudi shipments of oil to the U.S. increased 14% in 2012. Saudi Oil Minister Ali al-Naimi said recently that the rise of unconventional energy sources doesn't threaten his country's dominant role in world oil supply because demand also is increasing.

"I don't think anyone should fear new supplies…. The pie is getting bigger, and there is enough to go around," he said.

But the Nigerian oil minister, Ms. Alison-Madueke, sees danger for her country. "Shale oil has been identified as one of the most serious threats for African producers," she said in the U.K. this month. Those producers, she said, could lose 25% of their oil revenue as they are edged out of the U.S.

Nigeria has been hardest hit because its light and low-sulfur crudes compete directly with shale oil, unlike Saudi Arabia's heavier and more sulfurous crude. Other OPEC members who don't serve the U.S. market, such as Iran, are also complaining. Muhammad Ali Khatibi, Iran's envoy to OPEC, told The Wall Street Journal that a combination of rising U.S. shale production and tepid demand is bringing "the price down."

While Saudi Arabia can tolerate lower prices, "there will be some members, like Venezuela, Iran who will struggle at $90," said Amrita Sen, chief oil analyst at London-based Energy Aspects Ltd. The front month Brent contract for July settled at $102.62 a barrel Monday. Venezuela's oil minister said on Monday that he would push for a cut in OPEC production if oil falls below $100 a barrel.

Iran needs high prices to offset the loss of $26 billion of oil revenue last year from tough Western sanctions on its exports, according to estimates from the U.S. Energy Information Administration.

Algeria, which has been rattled by riots over food and housing, needs an oil price of $121 a barrel to cover planned domestic spending—including for roads, jobs and housing—according to the International Monetary Fund.

The country's oil and gas revenue fell by 9% in the first four months of 2012, according to government figures. Algerian Finance Minister Karim Djoudi has said that lower revenue tied to mounting U.S. shale production could force the government to cut domestic spending.

"Cutting subsidies without increasing wages could bring tremendous political animosity," and instability, said Geoff Porter, head of security consultancy North Africa Risk Inc.

OPEC officials said the group is preparing studies to evaluate the impact of U.S. shale oil on demand for its crude. "Definitely, we will review nonconventional shale oil from the U.S.," said Mr. Khatibi, the Iranian envoy.

However, there is no agreement on the size of the challenge. Mr. Khatibi said the North American oil boom has created a global oversupply of 1.5 million barrels a day. Delegates from Gulf nations see the excess at no more than 500,000 barrels a day.

In the past, Saudi Arabia has simply ignored more hawkish members such as Iran and increased oil production when they failed to reach an agreement—as was the case during an acrimonious split two years ago. Saudi Arabia is the only country with sizable flexible production, giving it some influence on prices.

But the group can ill afford new divisions. In 2008, Saudi Arabia was forced to backpedal from a unilateral supply boost after prices crashed by $100 a barrel.

The New PrometheusThe domestic energy industry is booming—and driving a U.S. economic revivalBy DANIEL YERGIN

When the 'shale gale'—the surge in the production of natural gas trapped in very dense shale rock—first came into public view in 2008, the focus was primarily on the energy and environmental implications. But the past couple of years have brought recognition of shale gas's economic consequences, beginning with major job creation in a time of stubbornly high unemployment. President Barack Obama has repeatedly cited the jobs impact of shale, including in his State of the Union address last year and even in one of his debates with Mitt Romney. At the same time, abundant low-cost energy is stimulating a revival of manufacturing in the U.S. as well as increased American economic competitiveness—as angst-ridden European CEOs will tell you. And the change has come quickly. Shale gas, only 2% of total U.S. natural gas production a decade ago, is now nearly 40%.

Comeback

By Charles R. Morris PublicAffairs, 179 pages, $12.99

The economic portent of America's unconventional oil-and-gas revolution is at the heart of Charles Morris's "Comeback: America's New Economic Boom." Mr. Morris is the author of a number of books on the U.S. economy and economic history. His most recent, the commendable "The Dawn of Innovation," described the explosive growth that resulted from America's first industrial revolution during the early decades of the 19th century. But it was in 1990, at another time of economic gloom, that Mr. Morris published "The Coming Global Boom," correctly predicting an era of strong economic growth.

Now he is back with a similar argument, namely that "the United States is on the threshold of a long-term economic boom, one that could rival the 1950s-'60s era of industrial dominance." The country, as he sees it, is at a turning point that most people, mired in chronic pessimism, are missing. The source of the boom this time, Mr. Morris says, will be "rising American productivity" and industrial "restructuring" that "has made the United States one of the most desirable manufacturing sites in the world, especially in states like Virginia, Tennessee, Georgia, the Carolinas, and Alabama."

The "manufacturing renaissance" in the U.S. is also fueled by what is happening elsewhere. With industrial wages increasing 15% to 20% per year, China is losing what had been the indubitable edge that transformed it into the workshop of the world. There is also the logistical advantage of manufacturing close to North American markets, especially when transportation costs are added in. All this is giving the U.S. renewed impetus as a manufacturing platform for global exports: Japanese auto makers now build cars in the U.S. for export to Europe; the German engineering conglomerate Siemens SIE.XE -1.38% does the same for gas turbines sold to Saudi Arabia.

But—and this is central to Mr. Morris's argument—what really turbo-charges this American advantage is what he calls "the new X-factor, the American energy advantage," the arrival of low-cost shale gas. Here is the big new chance for American industry. As Mr. Morris puts it, shale gas can be the central pillar of America's coming economic rebound. "Unless something goes horribly wrong," he says, "energy is a game changer." The U.S. and Canada have this ace up their sleeves while, at least at this point, no one else does.

There are other reasons to be optimistic, according to Mr. Morris: The comeback he foresees is bolstered not only by the new availability of inexpensive, abundant energy and the resurgence of manufacturing but also by an uptick in public infrastructure investment and the continuing growth of the health-care sector.

His main focus, however, is the positive economic impact of shale gas. He spends some time on the employment effects. He cites research findings from IHS, a research firm of which I am vice chairman, showing that 1.7 million jobs are currently supported by this unconventional revolution in oil and gas. (That doesn't include the additional jobs resulting from the expansion of manufacturing.) Most of these shale jobs have been created since 2008 and the beginning of the recession. The economic impact of shale, including especially the job numbers, helps explain why public policy has been supportive of shale gas and why state governors focused on economic development are among shale's biggest backers. And the job creation will continue to explode: Mr. Morris argues that this unconventional revolution could support more than four million jobs by the end of this decade.

Mr. Morris adroitly explains the workings of what he calls—no doubt to the alarm of some—"the splendid technology that makes [shale] possible." That is hydraulic fracturing, better known by the now-famous shorthand "fracking." This is the process of injecting water and sand mixed with a small amount of chemicals, under high pressure, to create fractures in rock deep underground that allow gas to flow into the drill hole.

But the author's discussion becomes confusing when he takes on the environmental questions around shale gas. Despite the oft-expressed concerns in the fracking debate about the amount of water used in the process, Mr. Morris points out, such drilling even in gas-rich Texas uses only 1% of the total water consumed in the state. He rightly underlines the importance of properly dealing with the waste water produced from drilling a well, one of the central tasks of proper environmental stewardship. All good, but then he also declares that the most dire portrayal of the environmental risks by anti-fracking critics is "mostly right." Yet then he switches course yet again and concludes that the environmental issues can be managed—although he never really demonstrates that they aren't being managed well in the first place.

Mr. Morris is particularly exercised about "fugitive emissions" of methane from gas production. This is a subject of major debate because methane is 25 times more potent a greenhouse gas than carbon dioxide. Mr. Morris wholeheartedly embraces the view that this is a very big problem, dismissing analysis that indicates that the risks have been greatly overstated. But in April, the Environmental Protection Agency—which had previously expressed much concern on this subject—significantly lowered its estimate of methane emissions owing to an improved understanding of well operations. Further reductions in the estimates will likely result from the prevalence of "green completions" in new wells, which trap methane instead of allowing it to be flared or vented into the atmosphere.

What really bothers Mr. Morris, however, is the possibility that the U.S. might join the ranks of liquefied natural gas (LNG) exporters. This, he says, would not only hijack the low-cost energy opportunity but would also turn the U.S. into "a raw material colony of an Asian industrial juggernaut"—that is to say, relegate the U.S. to the subservient role of provider of cheap energy for rising China.

Actually, he is a little late on that. The "train" (to use the industry word for LNG export facilities) has already left the station. The first new export facility to be permitted by the U.S. Department of Energy will begin exporting around 2016, and two weeks ago a second was approved.

Being a mere raw-material colony would clearly be a bad thing in anybody's book. But Mr. Morris's assertions are a little overheated. Markets themselves will dictate that only a handful of new LNG export facilities will be built in the U.S. There will be a great deal of competition, from present and future suppliers in other countries. As many as five new LNG export facilities are planned just on the west coast of Canada, a country that doesn't have a hang-up about energy exports. The huge new resources of natural gas that have been discovered off the shore of East Africa will also enter the market, and perhaps even the big discoveries off Israel. The U.S. won't be the lowest-cost supplier. The discipline dictated, moreover, by the cost of new projects—ranging from $7 billion to $60 billion—will also limit what gets built.

Mr. Morris's worry about exports reflects his fear that there may not be enough natural gas to go around. But today's natural-gas market is constrained by demand, not supply. Just a few weeks ago, the Potential Gas Committee, a nonprofit affiliated with the Colorado School of Mines and the authoritative source on the nation's gas resources, raised its projection for technically recoverable natural gas supplies in the U.S. by 26%.

When he gets to his third pillar—stepped-up spending on roads, bridges, railways and the like—Mr. Morris makes a compelling case that the U.S. is significantly under-investing in the infrastructure needed to support economic growth. "We now spend," he writes, "half as much on public infrastructure relative to the size of the economy as we did fifty years ago." He points, for example, to the deterioration of the inland waterways that tie the Midwest and its industries together and on which the manufacturing revival will depend. It was too late for his book, but the collapse a week ago of I-5 over the Skagit River in Washington state underscores his warnings about the risks from aging infrastructure, including tens of thousands of "structurally deficient" and "functionally obsolete" bridges around the country. Remedying the widespread infrastructure deficiency through public spending, Mr. Morris predicts, will add fuel to a once-again roaring industrial engine. "Infrastructure financed by borrowing has a long and honorable history in the United States," he writes.

But it is not only lack of such government finance that, in Mr. Morris's view, is holding things up. There is another big constraint: inordinate delay. To make that point, he calls on his own experience: He worked in New York City government 45 years ago trying to get a third water tunnel built for the city. It was supposed to take a decade, but "current expectations are that it will be completed around 2020." That may be an extreme, but it does point to what seems the ever-lengthening time it takes to "get to yes" on major infrastructure projects.

When it comes to health care—another pillar of the comeback—Mr. Morris asks an interesting question: Does it make sense that the purchases of refrigerators, cars and computers are considered positives for economic growth but not any expansion of medical services? He provides his own answer: Health care is a "vibrant industry" that contributes to growth.

In a previous book, "The Surgeons: Life and Death in a Top Heart Center" (2007), Mr. Morris investigated health care by "shadowing an elite cardiac unit" at Columbia-Presbyterian hospital in New York City for most of a year. But how health care fits into his argument in "Comeback" isn't so clear. He wants to build upon the "new Obamacare machinery" to extend "federal bargaining power in setting vendor payments." And he has no doubt as to who are the villains in his health-care narrative. "Doctors," he writes, "increasingly ply their trade within various forms of corporate organizations devoted to exploiting the hallowed fee-for-service payment paradigm by ping-ponging patients between as many diagnostic tests and minor procedures as they can." This seems to be a rather broad brush with which to paint doctors, many of whom are even more confused than the public about how health reform will work and what it will mean for their ability to practice.

Mr. Morris's other big villain is the drug industry. His proof is the hefty dollars in legal settlements between the federal government and drug companies. Yet the size of settlements between the federal government and companies, intent on avoiding litigation and reputation damage, is not necessarily proof of wrongdoing. What all this really has to do with shale gas and manufacturing revivals isn't obvious, and Mr. Morris doesn't persuasively connect these developments.

Overall, "Comeback" captures the major changes set in motion by the unconventional oil and gas revolution. The result, Mr. Morris says, will be higher economic growth and a quickly disappearing federal budget deficit. "Trade and budget deficits will shrink in real terms and cease to dominate the political discourse," he writes. This will in turn change politics: "A vigorously growing economy going into the 2016 election should lock in a liberal ascendancy for a considerable period." To help speed the decline of the deficit, Mr. Morris, who describes himself as an "old-fashioned liberal," calls for moving tax rates up "a good notch," though without addressing the setback that such a "good notch" might mean for the comeback.

There are misfires on facts in the book. Natural-gas prices did not plummet last year due to lack of pipelines. It was primarily because production exceeded demand. In other words, there was a surplus. Here Mr. Morris is confusing natural gas with oil, where the once-famed WTI crude—the West Texas Intermediate—stripped of its place as global benchmark, sells at a discount owing to inadequate pipeline capacity. It is true, as Mr. Morris says, that North Dakota is now the second largest oil-producing state in the country, but it follows not Alaska, as he writes, but Texas. In fact, Alaska, worrying about declining production, is now in fourth place, behind California. Speaking of North Dakota, Mr. Morris glides rather quickly over the significance of the rapid growth in "tight oil" that uses the same technology as shale gas. Yet, with U.S. oil production up 43% since 2008, the impact is no less striking. And more impact is to come.

The contribution of "Comeback" is to cogently lay out the bright economic consequences of the unconventional oil and gas revolution and the revival of manufacturing. Shale gas and tight oil are proving, in ways not expected even a couple of years ago, the fuels of America's comeback. Without them, the economy, instead of gearing up for a comeback, would have been held back even more than it has these past few years.

Wind power has failed to deliver what it promisedThe wind-power industry is expensive, passes costs on to the consumer and does not create many jobs in return

Today, The Sunday Telegraph reveals how many ''green jobs’’ the wind-power industry really generates in exchange for its generous subsidies. The figures show that for 12 months until February 2013, a little over £1.2 billion was paid out to wind farms through a consumer subsidy financed by a supplement on electricity bills. During that period, the industry employed just 12,000 people, which means that each wind-farm job cost consumers £100,000 [US$ 157,000] – an astonishing figure. ...Wind farms can end up being surprisingly environmentally unfriendly, too. When the wind does not blow and the turbines fail to do their job, consumers have to fall back on the very fossil fuels that they were designed to replace. The result is that we come to rely on foreign imports of oil and gas that hit the household budget hard (domestic coal stations that ought to supply more of the demand have been closed in order to meet carbon-emission reduction targets). Moreover, wind farms can be a blot on the landscape: the dormant turbines take up large tracts of land and kill wildlife; it is the visual pollution of our beautiful countryside that has led some communities to protest against their presence.

The Government has shown recognition of public concern by announcing that residents will be able to stop the construction of wind farms. (more at link above)

The debut of a new truck engine rarely attracts much attention. But this spring Cummins Inc. CMI -2.19% released two new truck engines worthy of notice: They are designed to run on natural gas, not diesel. Natural gas is abundant, domestically produced, cleaner and cheaper than oil-derived diesel. It could help set America free of foreign oil.

The natural-gas-powered ISL G and ISX 12 engines are the latest sign of the country's fundamental shift in energy resources and infrastructure. It's not the shift that the Obama administration has tried to engineer by shoveling money at wind-power projects and electric cars. Cummins built its engines without a penny of government support—a reminder that free markets can solve problems that politicians argued about for decades but failed to fix.

Natural-gas reserves are plentiful but not always easy to recover. It took an individual entrepreneur, Texan George P. Mitchell, to perfect the technology of hydraulic fracturing beginning in the 1990s that has made so much more of the gas available. And fracking, it turns out, also can be used to recover oil from formations that could not previously be tapped.

Fracking technology is responsible for last year's 14% increase in oil production to 8.9 million barrels per day, the largest increase ever, and a massive, five-year increase in natural gas production, to 28 billion cubic feet a day from five billion in 2008. The increased supplies of both also are responsible for a drop in oil imports and declines in carbon-dioxide emissions to 1993 levels.

I have no idea what Mr. Mitchell's motivations were, but I'm confident that profits were at or near the top of the list. By serving his own interests, as Adam Smith put it more than 200 years ago, he served the interests of society.

The impetus for fracking cannot be found in four decades of presidential speeches about energy independence, or in any acts of Congress. Instead, it arose from economically painful spikes in oil prices engineered beginning in the 1970s by the OPEC cartel. High prices did what they always do—they set off a hunt both for substitutes and for more supplies to take advantage of high prices.

Fracking technology addresses both issues by increasing supplies of oil and of its cleaner, cheaper substitute, natural gas. These two forces—the search for substitutes and the rush to cash in on high prices—will change the nation's economy profoundly.

Another crucial factor contributed to the energy revolution. Plentiful oil and natural-gas reserves exist around the world, but the U.S. is far ahead of every other country in bringing those resources out of the ground and onto the market. The reason? America is one of the few countries where an individual or company can own the resources that lie beneath the ground.

Almost everywhere else—including even the United Kingdom—the rights to minerals of all kinds, including oil and natural gas, are claimed by the government. Unless the government wants you to drill, you might as well put your tools away. As a consequence, there is much less incentive to innovate. Why bother if you can't own what you produce, or you can't profit except at a bureaucrat's sufferance?

Today, because fracking is producing oil and natural gas at record levels, others are joining Cummins in getting into the act. Companies like T. Boone Pickens's Clean Energy Fuels are laying out a network of natural-gas filling stations on major U.S. highways so that trucks, using new engines, can fuel up. New pipelines, such as the one Spectra Energy proposes to connect New York and New Jersey, are in the works, in addition to the 16,000 miles of interstate natural-gas pipelines built over the past decade.

Most energy analysts, as well as big oil companies like Exxon, expect that the U.S. will become a net energy exporter between 2020 and 2030. When that happens, the $400 billion that Americans are on target to send overseas this year to pay for oil imports will shrink, perhaps to zero. A $400 billion swing from negative to neutral, or even to positive, in the energy trade balance is something no one would have predicted even a few years ago.

Letting markets do their work sometimes requires an act of faith. The temptation that many people have, especially in government, is to give those forces a shove in one direction or the other. But when people are allowed to use market signals to determine where and how to mobilize their creativity, resources, energy and effort, amazing things can happen. Abundant energy for the foreseeable future is one spectacular example.

Mr. Kurtzman is the executive director of the Milken Institute's Senior Fellows Program.

The Carbonated PresidentObama unveils a war on fossil fuels he never disclosed as a candidate.

President Obama's climate speech on Tuesday was grandiose even for him, but its surreal nature was its particular hallmark. Some 12 million Americans still can't find work, real wages have fallen for five years, three-fourths of Americans now live paycheck to check, and the economy continues to plod along four years into a quasi-recovery. But there was the President in tony Georgetown, threatening more energy taxes and mandates that will ensure fewer jobs, still lower incomes and slower growth.

Mr. Obama's "climate action plan" adds up to one of the most extensive reorganizations of the U.S. economy since the 1930s, imposed through administrative fiat and raw executive power. He wants to reduce greenhouse gas emissions by 17% by 2020, but over his 6,500-word address he articulated no such goal for the unemployment rate or GDP.

The plan covers everything from new efficiency standards for home appliances to new fuel mileage rules for heavy-duty trucks to new subsidies for wind farms, but the most consequential changes would slam the U.S. electric industry. These plants, coal-fired power in particular, account for about a third of domestic greenhouse gases.

Last year the Environmental Protection Agency released "new source performance standard" regulations that are effectively a moratorium on new coal plants. The EPA denied that similar rules would ever apply to the existing fleet, or even that they were working up such rules. Now Mr. Obama will unleash his carbon central planners on current plants.

Coal accounted for more than half of U.S. electric generation as recently as 2008 but plunged to a mere 37% in 2012. In part this tumble has been due to cheap natural gas, but now the EPA will finish the job and take coal to 0%.

Daniel Shrag of Harvard, an Obama science adviser, told the New York Times Monday that "Politically, the White House is hesitant to say they're having a war on coal. On the other hand, a war on coal is exactly what's needed." At least he's honest, though in truth Mr. Obama's target is all forms of carbon energy. Natural gas is next.

The higher costs will ripple through the energy chain, which is precisely Mr. Obama's goal. Only by artificially raising the cost of carbon energy can he make even heavily subsidized "renewables" competitive.

In general every $1 billion spent complying with an EPA rule threatens 16,000 jobs and cuts GDP by $1.2 billion—and the agency is now writing scores of multibillion-dollar rules. Keep in mind that last month the Administration quietly raised the "social cost" of carbon by 60% in a regulatory filing related to microwave ovens. That means the EPA can jack up costs by 59.99% and still justify them by claiming the higher benefits.

This regressive burden won't merely be borne by average American consumers and utility rate-payers—especially in the Midwest and Southern regions that use the most coal. This also threatens one of the few booming parts of the economy, the energy revolution driven by shale gas and unconventional oil. The return of manufacturing to the U.S. depends on this cheap abundant energy, and it could as easily re-relocate overseas as the U.S. becomes less competitive.

For good measure, Mr. Obama also declared that he will approve the Keystone XL pipeline "only if this project does not significantly exacerbate the problem of carbon pollution." Yet the oil in Alberta won't stay in the ground if Mr. Obama blocks the route to the Gulf of Mexico. It will be shipped by rail and boat to China and elsewhere. The only question is whether America will benefit from this shovel-ready project that will create tens of thousands of jobs.

Speaking of futility, Mr. Obama's ambitions will have no effect on global atmospheric carbon concentrations. Emissions are already falling in the U.S., thanks primarily to the shale gas boom, but emissions are rising in the developing world. Mr. Obama pandered to the climate-change absolutists by saying "We don't have time for a meeting of the Flat Earth Society." But he never explained how his plan will reduce warming, or why climate models have failed to predict the warming slowdown of the last dozen or so years even as more CO2 is pumped into the atmosphere.

Most striking about this Obama legacy project is its contempt for democratic consent. Congress has consistently rejected an Obama-style "comprehensive" anticarbon energy plan. That was true even when Democrats ran the Senate with a filibuster-proof majority in 2009-2010 and killed his cap-and-trade energy bill. The only legislative justification for Mr. Obama's new plan is an abusive interpretation of the Clean Air Act, which was last revised in 1990 and never mentions carbon as a pollutant.

So instead Mr. Obama will impose these inherently political policy choices via unaccountable bureaucracies, with little or no debate. Mr. Obama might have at least announced his war on carbon before the election and let voters have a say. Instead he posed as the John the Baptist of fossil fuels in locales such as Ohio, Pennsylvania and Virginia—taking credit for the shale fracking boom he had nothing to do with and running ads attacking Mitt Romney as anticoal.

Now safely re-elected, Mr. Obama figures he can do what he pleases. The Americans who will be harmed will have to console themselves with 99 weeks of jobless benefits, food stamps and ObamaCare.

I doubt it will hit 120 in Vegas this week. Also Tsunamis in NJ? Come on. We are being barraged with endless scare tacticts. No coincidence. Sooner or later that island will split in the Canary islands and a wave will wipe out the East Coast. So we should stop fracking?

Yes. Now he is not up for election he is ramming everything through he can. Then Hillary is going to "fight for women" against the "war on women" from the Republicans.

Women will eat it right up too.

I don't understand why taxpayers just cannot get traction? I guess there are more of them then us as Marc Levin once put it.

CCP, Good points. As mentioned in the media issues post, they can send out a false message 92 times on broadcast multiplied by every other source that picks that up and amplifies it, call opposition flat earth, then poll on the false message and create more 'news' stories to perpetuate it. They pass or just deem economically harmful policies creating more need for government help and the downward cycle accelerates. Meanwhile, our greenhouse gases were declining without their help due to fracking they oppose and would decline much further if we built emission-free nuclear. But no, because the goal of the eco movement has always been to bring down prosperity.

Fracking supporters say it could set America on the road to energy independence and drastically change our economic prospects while helping address climate change.

But who should be in charge of regulating fracking?

Fracking—short for hydraulic fracturing—involves injecting fluids into the ground to access hard-to-reach reserves of oil and natural gas, including shale gas, which the U.S. has in vast abundance but hasn't been able to reach easily up to now.

Many advocates argue that the federal government should step in and regulate the practice more forcefully because fracking can have big environmental impacts that can't be managed effectively by individual states alone. At scale, they say, those hazards inevitably reach across state lines and become a national problem. The result could be widespread bans on the practice and a premature end to the shale-gas revolution, they say.

But others say states are well equipped to regulate fracking. They say the risks of fracking are overstated, and the impacts of fracking—both positive and negative—are mostly local, and different people balance them differently. So regulation should be left to the people who feel them most directly. Existing federal authority can handle whatever problems may spill across state lines, they say.

Jody Freeman argues for federal regulation of fracking. She is the Archibald Cox professor of law at Harvard Law School and was counselor for energy and climate change in the White House in 2009-10. Making the case that regulation should be handled by the states is David Spence, associate professor of law, politics and regulation at the McCombs School of Business and School of Law at the University of Texas.

Yes: A National Issue Can't Be Addressed State by State

By Jody FreemanWe need stronger federal regulation of fracking for a simple reason: It affects the entire nation, not just individual states.

Fracking has the potential to help the U.S. achieve energy independence, boost the economy and reduce greenhouse-gas pollution.

Yet the cumulative environmental impact of drilling at this scale is great, and it needs to be addressed in a comprehensive way. We won't achieve the full promise of fracking if environmental impacts and public reaction cause land to be pulled out of production.

Big Impacts

Fracking produces significant amounts of air pollution and methane, a potent greenhouse gas. It also generates wastewater, often containing toxic chemicals. At scale, fracking requires vast amounts of water, which can reduce regional supplies. And industrializing the countryside not only disturbs locals, it can harm habitat and wildlife.

States aren't fully up to the task of regulating these risks. And the problems inevitably cross state borders, making them a national issue.

A study by Resources for the Future, an independent research organization, showed that state standards for well integrity, wastewater management, disclosure of the content of fracking fluid and other aspects of drilling vary considerably, and some states lag far behind others. The same study reported that state enforcement capacity is generally lacking, and even states experienced with oil and gas are struggling to keep up with the pace of drilling.

Even well-intended states may lack the capacity or political will to enforce adequate protections. And there's always the chance that states may compromise standards to attract development and jobs.

States should have a strong say in the regulatory process. But we must set federal minimum standards to guarantee that no state falls below a reasonable level of care.

Coal mining offers a good analogy. Despite objections that mining was local and best handled by states, Congress passed a federal law setting minimum performance standards while giving the states the lead in implementation and letting them tailor rules to local conditions. Congress said mining was a national priority, so its risks should be addressed nationally.

The same holds for fracking. Performance standards are flexible about how to achieve environmental goals, which is important since the geology of drilling sites varies.

Building Trust

Comprehensive minimum federal standards would also help to build public trust, which is sorely needed right now.

The debate on fracking is increasingly polarized. Many jurisdictions have banned it, and more will undoubtedly do so if environmental impacts multiply. The industry is only as good as its worst operators. Support for sensible national standards would signal that the industry wants to address public concerns.

Critics of federal regulation argue that our current legal framework works fine. But fracking regulation is a patchwork of rules and jurisdictions riddled with gaps and inconsistencies.

The Interior Department has proposed standards for well integrity and public disclosure on federal lands, but state and private lands, where most fracking occurs, are exempted by Congress. The Environmental Protection Agency can regulate air and water pollution from drilling sites, but not the drilling process. Wastewater from fracked wells, though often dangerous, is excused from federal requirements for handling hazardous waste. In some states, as many as six agencies share authority over drilling.

This is not a regulatory system anyone should be proud of.

Critics of federal regulation also say that it will raise costs. On this, they are right. But critics, and especially industry leaders, should take the long view: A small increase in regulatory costs is a smart investment in the social license to operate.

Ms. Freeman is the Archibald Cox professor of law at Harvard Law School and was counselor for energy and climate change in the White House in 2009-10. She can be reached at reports@wsj.com.

=====================================

No: States Can Best Balance The Competing Interests

By David Spence

Like all forms of energy production, fracking entails risks. States are better equipped than the federal government to regulate most of those risks.

Why? Because both the benefits and the costs of fracking fall mostly on states and local communities. States gain the most from added jobs and tax revenue; they face the truck traffic, noise, pollution risks and rapid industrial growth. Consequently, states are in the best position to figure out how best to balance fracking's costs and benefits.

It is true that the natural-gas industry risks losing public trust if it doesn't perform to high standards. But turning the regulatory framework over to Washington isn't the answer.

Limited Intervention

In general, the federal government should regulate when the important impacts of the regulated activity cross state lines, when states cannot regulate efficiently or when national interests are at stake. None of these justifications apply to fracking.

Only a few of the risks of shale-gas production—methane leakage, for example—extend beyond state lines. And the Environmental Protection Agency is addressing those interstate risks already, using its existing regulatory authority.

As for the argument that states just can't handle the job of regulating, it is true that regulation lagged behind the industry's growth in some states at first. But states are quickly adapting. States are strengthening their shale-gas regulations to tighten well-construction and waste-disposal standards and require disclosure of fracking-fluid ingredients, sometimes bringing industry and environmental groups together in the process.

They're also coming up with regulatory systems that fit local conditions. Different rules for different states are necessary to match the local geography—for example, drillers may use different drilling specifications or wastewaster-disposal methods, depending upon the location.

Remember that states have been overseeing natural-gas development for decades. State oil and gas commissions have much more experience with permitting and overseeing natural-gas production than the EPA does.

Where's the Confusion?

Federal-regulation advocates also argue that the current system of multiple state and federal regulators produces a confusing patchwork of rules. But this kind of regulatory complexity is the norm in the U.S.

Few, if any, industries are overseen by a single federal agency. Not surprisingly, neither industry nor the states are clamoring for a single federal permitting regime for the fracking industry.

Some critics have worried about states lowering their standards to attract industry. But states are not competing with one another for limited natural-gas industry jobs and capital as they compete for, say, an automotive plant. To the contrary, investment capital will find profitable shale-gas production opportunities wherever they exist.

Advocates of federal regulation point to the case of coal mining, which Congress regulates based on its national importance. But coal mining and combustion produces health and environmental risks that dwarf those associated with natural-gas production.

By reducing our reliance on coal, the shale-gas boom helped push U.S. carbon emissions in the first quarter of 2012 to their lowest point since 1992—reflecting fewer emissions not just of carbon but of other byproducts of coal combustion that kill tens of thousands of people a year.

We need to continue to study fracking, and to ensure that it is done safely. Fracking offers the prospect of economic and environmental benefits, but it also presents environmental risks.

Each state is balancing those benefits and risks in its own way. Some are taking a cautious approach; others are embracing the economic benefits of shale gas more eagerly. We should continue to let states devise local solutions to what are mostly local problems.

Mr. Spence is associate professor of law, politics and regulation at the McCombs School of Business and School of Law at the University of Texas. He can be reached at reports@wsj.com.

Isn't it exactly the other way around? The Federal government has been a complete failure in the regulation of the energy industry and states have presided over our greatest successes.

Let's say there is a hypothetical difference over how to regulate fracking on the border of North Dakota and Montana, a damage from one state that spills over to the other. Why not first let those two states try to resolve that before we turn to NY, Calif and DC for the 'answer'.

The answer out of Washington has been consistent. Produce no energy. Force the production to countries that are enemies of the US, who have drilling and refining etc techniques far worse than ours, then send them trillions of dollars to take up arms and attacks against us.

"Let states devise local solutions to what are mostly local problems."

I'm not saying one was, I'm saying that it is the fear of this external dis-economy which drives the conversation.

I appreciate that but see the motives of the opponents quite a bit more cynically. Please forgive my quibbling - as I continue to do so.

Your point posed the question, "IF (emphasis mine) the question presented is the contamination of an aquifer..."

I would like to stop you right there because I have taken the time to gather, quote and publish, in these threads, statements from the regulatory authorities of every state involved in fracking claiming that there have been no incidents to their knowledge of contaminated ground water. Please post otherwise (anyone), science, not NYT speculation. I also posted Gov. Hickenlooper's testimony to the Senate Energy committee (D-Colo.) bragging that he drank the fracking fluid: http://www.huffingtonpost.com/2013/02/13/gov-john-hickenlooper-drank-fracking-fluid-hydraulic-fracturing_n_2674453.html

The article questions, who should be in charge of regulating fracking?

I suggest that we don't regulate safe and healthy production. What we do is prohibit ground water contamination.

Please understand (everyone) that there is a war against energy production and prosperity that goes far beyond science and pollution. In war, one may need to take sides. If fracking is destroying drinking water, let's stop it. If it is not, let's legalize it. These 'regulators' in MN are trying to stop SAND from crossing state lines in order to hinder oil and natural gas production in North Dakota. Good grief. So let's give power to people even further away from it. Elites who know better than us like we do for everything else.

Every day, about ten people die from unintentional drowning. Of these, two are children aged 14 or younger. Drowning ranks fifth among the leading causes of unintentional injury death in the United States.

"I suggest that we don't regulate safe and healthy production. What we do is prohibit ground water contamination. "

Fair enough!

Allow me to restate then:

In that ground water is an interstate phenomenon (contamination will not be limited to intrastate) it seems logical the legal regime for it should be interstate, i.e. federal as well.

If I may, I think you are conflating more than one point:

a) the motives of some opponents of fracking;b) the track record so far;c) whether a state or federal legal regime should be the legal framework.

My point speaks specifically to the third of these; to it the first two are irrelevant.

At the risk of becoming annoying, I continue. Again, what contamination crossing state lines? Yes, federal would be the correct framework, if not for the fact we already regulate water contamination at the federal level, no new problem has been identified to be in need of a solution, the federal apparatus has proven it can bring down any industry it chooses without solving a problem, and the fact that this EPA is no longer under the control of congress nor is it a government run of, by or for the people. A federal solution should be a last case answer for what states are unable to resolve amongst themselves, which is not the case right now in fracking.

The point of this discussion right now is the implication that we need new laws and new bureaucracies to address this new and growing threat to our environment. But there are no instances. There is no letter drafted by one state alleging their water supply has been contaminated by under-regulated or under-enforced activity in another state. And it begs the question, contamination with what? Fracking fluid?

I don't think sounding off warning signals about federal government over-regulation before we head off into making a huge mistake is a small matter - or irrelevant. It is not the motives of some, but the motives of all who oppose an industry with no evidence of pollution that are in question, IMHO.

Turn this over to the Feds right now and they will destroy it. It is no small matter. North Dakota is not going to accept the energy policies of NY, Calif and DC at this point in time IMHO. Worst case isn't a destroyed industry; we may see states secede over it.-----

Take the federal logic one step further out. The U.S. must share an aquifer or two with Canada, and Belgium with France etc. Isn't the only real solution for this one world government? If not, why not? We don't trusty the UN to do the right thing for the right reasons in our own best interests. Well guess what?

No worries on my account. As best as I can tell we are just having a conversation

"Again, what contamination crossing state lines?"

It would be from the fracking process.

"Yes, federal would be the correct framework"

Ah, we are in agreement then. I had not gotten this impression from your previous posts. For example, you wrote:

"Isn't it exactly the other way around? The Federal government has been a complete failure in the regulation of the energy industry and states have presided over our greatest successes. Let's say there is a hypothetical difference over how to regulate fracking on the border of North Dakota and Montana, a damage from one state that spills over to the other. Why not first let those two states try to resolve that before we turn to NY, Calif and DC for the 'answer'. The answer out of Washington has been consistent. Produce no energy. Force the production to countries that are enemies of the US, who have drilling and refining etc techniques far worse than ours, then send them trillions of dollars to take up arms and attacks against us."

This sure reads to me like favoring state over federal regulation Indeed, WHY do you favor federal regulation?

"if not for the fact we already regulate water contamination at the federal level,"

I am uninformed with regard to this. What is the current legal/regulatory regime.

We are perhaps in agreement but headed different directions with this.

If there is contamination of water supplies that cross state lines, the federal government certainly could justify jurisdiction over it. But, a) we haven't seen a trace of evidence of that, b) we already have laws and enforcement mechanisms in place since the 1970s, c) the EPA as we knew it has more recently run astray and can't be trusted with any hint of new power or bureaucracy, and d) the states in with this problem, and there aren't any, already have protective agencies on both sides of any border should first try to resolve the problem, that doesn't exist, among themselves before imposing a solution, to no problem, from Washington DC.

"The contamination" would be from the fracking process." - To that I have posted that the Dem Gov of Colorado drank the fracking fluid, and all state regulatory agencies have testified no instances of contaminated drinking water from fracking. No doubt the opponents of civilization/fracking will come forward some day with East Anglia data, but for now, nothing credible has made it to these pages.

Let's ask the jurisdictional question a different, more personal way. (botched analogy warning) At what level should we regulate Martial Arts Schools that reach across state and national lines with their scope and impact? Local, state, federal, all of the above, or by some one world government that can cover the entire impact? Visualize for one thing a great, big, new federal building housing thousands of new scientists, bureaucrats and enforcement and compliance agents with unlimited budgets labeled something like the new federal bureau of martial arts school department of monitoring, enforcement, compliance and new rules generation agency committed to killing off an industry they don't like. But the right answer is none of the above. We don't have a problem, a complaint, or an incident; these schools are doing far more good than harm, and there are already plenty of far-reaching laws in existence at all of these levels to handle problems that could arise. My point is that the original question leads to a solution not needed because we have not identified a problem.-----

"no new problem has been identified to be in need of a solution"So then the point to make is there already is federal regulation.

Steve Forbes: The U.S. is on its way to becoming the world's largest oil producer.

How much longer will we hear empty claims from President Obama, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid that the United States has only 3% of the world's oil supplies and therefore, "we can't drill our way out of the problem"? The recent increase in domestic oil and gas production is sending shock waves through the global energy economy and is bolstering the USA's standing among the energy-producing giants in the Middle East. Not only are U.S.-Middle East relations changing in a geopolitical sense, but also economically, as trade balances reflect increasing U.S. energy production.

According to a recent report from the Energy Information Administration, U.S. domestic crude-oil production in May exceeded oil imports for the first time in 16 years. Moreover, this past February, the U.S. met 88% of its own energy needs -- the highest rate since 1986. These milestones are in no small part due to the oil and natural gas boom and improved technologies such as hydraulic fracturing.

But that's not all. U.S. imports from the Organization of the Petroleum Exporting Countries have decreased more than 20% since 2010 with the International Energy Agency predicting that the U.S. could become the world's largest oil producer by 2020, and possibly energy independent by 2035.

These developments have considerable implications on U.S. foreign policy. If we continue developing our energy and manufacturing sectors, no longer will the U.S. have to kowtow to dictators of volatile nations for fear of disrupting our energy supply or rocking international markets. And we will feel far less compelled to intervene in foreign conflicts to stabilize world energy supplies. Indeed, the calculus for determining a threshold for intervention in another sovereign nation is changing in a promising way. The U.S. will always have a vested interest in a stable Middle East but the prospect -- and eventual realization -- of U.S. energy independence tips the scale and lessens the ability of rogue dictators to exercise their geopolitical control.

Decreased dependency on foreign oil doesn't just impact American foreign policy; it also opens the door for the U.S. to no longer send hundreds of billions of dollars each year to countries not always friendly to the U.S. Representatives from OPEC member countries recently complained about the impact of the largely unexpected U.S. shale boom. Oil and gas imports from Nigeria, Algeria and Angola -- three of OPEC's African members -- have decreased to their lowest levels in decades. Between 2011 and 2012, exports from those countries dropped by 41%.

Additionally, the shale gas/natural gas boom here at home could spur an energy and manufacturing renaissance that will create thousands of new, high-paying jobs in dozens of states. However this manufacturing resurgence will never fully occur if agencies such as the Environmental Protection Agency and others maintain their usual bunker mentality while mandating excessive and costly regulations that effectively block new energy and manufacturing operations.

Consider the Alaska oil pipeline, which was mired in regulatory limbo for more than five years while bureaucrats scrutinized, litigated and studied its impact. But since its completion in 1977, the Alaska pipeline has delivered more than 16 billion barrells of oil to market, while maintaining an exemplary environmental record.

The Keystone XL pipeline, which would deliver crude oil from a friendly Canada is experiencing similar delays. Under review since 2008, the Keystone pipeline has been studied more extensively than the Alaska pipeline. The delay is not only costing the U.S. cheap energy from a reliable neighbor, but also thousands of good-paying jobs.

A Renewable Fuel Standard is another example of misguided government regulation. The RFS mandates the blending of an experimental, cellulosic ethanol into gasoline and is driving up costs for refineries that are either forced to purchase renewable fuel credits or face large fines for not using a biofuel that exists in laboratories, not commercially.

Then, there are the upcoming EPA ozone standards: tougher restrictions on smog levels that by some estimates, will cost $90 billion a year just to implement. Under newly proposed EPA ozone targets, even Yellowstone National Park would be out of compliance. Many cities are still struggling to comply with 2008 standards. A recent Heritage Foundation study revealed that by the year 2100, carbon-capping policies could cost the global economy a staggering $100 trillion.

The U.S. oil and natural gas boom is drastically improving our standing in the global economy and strengthening our foreign policy might. It can also create a manufacturing boom if Washington gets out of its own way. And Americans want this energy and manufacturing renaissance to occur. A recent Gallup survey showed that 48% of Americans place higher priority on economic recovery and job growth over mandating additional environmental protections.

Until Obama gets out of the way energy sits in a holding pattern on the runway. Hillary will do whatever gets her the most votes. So if most people would like to open the energy tidal wave she will be for it. If environmentalists win the propaganda war she will side with them. We already know the Clintons are all poll driven. Despite what Bill recently claims with his bravery in bombing Kosovo despite what the polls said. (tail wagged the dog was the reason for that. not "courage". just self serving headline diversion).

Shocking, a Letterman show where Letterman stopped being funny. What part of no verified cases of water contamination does this political wannabe not understand?

First he says of himself, "I'm not smart enough to understand this", and I agree with him.

Second, he confirms my allegation that there is a war against fracking. He offers not a shred of new evidence. Does anyone think Letterman came up with this rant on his own? That's a joke. NYT has done entire series without offering a shred of evidence either. Just speculation of damage.

Famous people in this case not caught reading the forum, let's go over what he would know if he checked the forum first?

I took the time to compile statements from all states involving fracking that they have no incidents reported of drinking water ever getting contaminated, and I welcome the opportunity to bring these posts forward. (Excerpted below)

As if Letterman deserves reply, there is no mystery as to what is in tap water; my city's tap water is tested and measured every year, based not on corporate greed, but on the existing requirement of ample federal, state and local laws already in place. The mention of methane discovered in water is quite frightening, implied by fire in the faucets, but this was not new nor caused fracking. http://dogbrothers.com/phpBB2/index.php?topic=1118.msg51022#msg51022 Where in science or logic did THAT connection come from? Both water and natural gas come from the ground. One didn't cause the other unless you present evidence that it did. Screw Letterman, the question is what gives Crafty and others with informed logic their skepticism of America's two cleanest forms of energy. Would you prefer dirty energy from farther away, or doing without energy and our fleeting prosperity?

"In recent months, the states have become aware of press reports and websites alleging that six states have documented over one thousand incidents of ground water contamination resulting from the practice of hydraulic fracturing. Such reports are not accurate." - President of the Ground Water Protection Council

"After 25 years of investigating citizen complaints of contamination, DMRM geologists (Ohio Division of Mineral Resources Management) have not documented a single incident involving contamination of ground water attributed to hydraulic fracturing." - Ohio Department of Natural Resources

After review of DEP's [Pennsylvania Department of Environmental Protection] complaint database and interviews with regional staff thatinvestigate groundwater contamination related to oil and gas activities, no groundwater pollution or disruption of underground sources of drinking water has been attributed to hydraulic fracturing of deep gas formations. - Pennsylvania Department of Environmental Protection

"we have found no example of contamination of usable water where the cause was claimed to be hydraulic fracturing." - New Mexico Energy, Minerals and Natural Resources Department

"I can state with authority that there have been no documented cases of drinking water contamination caused by such hydraulic fracturing operations in our State." - STATE OIL AND GAS BOARD OF ALABAMA

"Though hydraulic fracturing has been used for over 50 years in Texas, our records do not indicate a single documented contamination case associated with hydraulic fracturing." - chief regulatory agency over oil and gas activities in Texas

"There have been no verified cases of harm to ground water in the State of Alaska as a result of hydraulic fracturing." - Commissioner Alaska Oil and Gas Conservation Commission

"To the knowledge of the Colorado Oil and Gas Conservation Commission staff, there has been no verified instance of harm to groundwater caused by hydraulic fracturing in Colorado."

"There have been no instances where the Division of Oil and Gas has verified that harm to groundwater has ever been found to be the result of hydraulic fracturing in Indiana." - Director, Indiana Department of Natural Resources

"The Louisiana Office of Conservation is unaware of any instance of harm to groundwater in the State of Louisiana caused by the practice of hydraulic fracturing."

"My agency, the Office of Geological Survey (OGS) of the Department of Environmental Quality, regulates oil and gas exploration and production in Michigan. Hydraulic fracturing has been utilized extensively for many years in Michigan, in both deep formations and in the relatively shallow Antrim Shale formation. There are about 9,900 Antrim wells in Michigan producing natural gas at depths of 500 to 2000 feet. Hydraulic fracturing has been used in virtually every Antrim well. There is no indication that hydraulic fracturing has ever caused damage to ground water or other resources in Michigan."

" Screw Letterman, the question is what gives Crafty and others with informed logic their skepticism of America's two cleanest forms of energy"

Ummm , , , sorry for my lack of clarity; I strongly favor the development of our natural gas via fracking-- though I do think that it would be a good idea politically if people were to be made aware of a watchful regulatory eye making sure nothing goes wrong.

I posted Letterman's remarkably uninformed rant precisely to let you tee off

People read certain publications and assume we already proved fracking is killing us. Like Letterman's writers, I oppose poisoning the planet; I just wish they would cite one credible instance before we shut down the American economy. As I posted previously, imagine what our 0.0% growth rate looks like without the boom in energy, and none of it coming from federal lands. The political-regulatory war against fracking isn't hypothetical. Too bad it is synonymous with a war against science.

most electric-car assessments analyze only the charging of the car. This is an important factor indeed. But a more rigorous analysis would consider the environmental impacts over the vehicle’s entire life cycle, from its construction through its operation and on to its eventual retirement at the junkyard.

As environmental disasters go, the explosion Saturday of a runaway train that destroyed much of the Quebec town of Lac-Mégantic, about 20 miles from the Maine border, will probably go down the memory hole.

It lacks the correct moral and contains an inconvenient truth.

Not that the disaster lacks the usual ingredients of such a moral. The derailed 72-car train belonged to a subsidiary of Illinois-based multinational Rail World, whose self-declared aim is to "promote rail industry privatization." The train was carrying North Dakota shale oil (likely extracted by fracking) to the massive Irving Oil refinery in the port city of Saint John, to be shipped to the global market. At least five people were killed in the blast (a number that's likely to rise) and 1,000 people were forced to evacuate. Quebec's environment minister reports that some 100,000 liters (26,000 gallons) of crude have spilled into the Chaudière River, meaning it could reach Quebec City and the St. Lawrence River before too long.

Environmentalists should be howling. But this brings us to the inconvenient truth.

The reason oil is moved on trains from places like North Dakota and Alberta is because there aren't enough pipelines to carry it. ...Pipelines account for about half as much spillage as railways on a gallon-per-mile basis. Pipelines also tend not to go straight through exposed population centers like Lac-Mégantic. Nobody suggests that pipelines are perfectly reliable or safe, but what is? To think is to weigh alternatives. The habit of too many environmentalists is to evade them....In 2001, the U.N.'s Intergovernmental Panel on Climate Change insisted that "global average surface temperatures [will rise] at rates very likely without precedent during the last 10,000 years," and that they would rise sharply and continuously.

Yet in the 15 years since 1998, surface air temperatures have held flat, a fact now grudgingly conceded by the climate-science establishment, despite more than 100 billion tons of carbon dioxide having been pumped into the atmosphere over the same period. ...The world needs a credible environmental movement. Conservation matters. So does the quality of water and air. ...The first application for a Keystone XL pipeline permit was filed with the U.S. State Department in 2008. Since then, the amount of oil being shipped on rails has risen 24-fold. Environmentalists enraged by this column should look at the photo of Lac-Mégantic that goes with it, and think it over.

Wind turbines produce power only when the wind is blowing. But perhaps more importantly, wind production builds only when the subsidies are flowing.

The wind industry is experiencing slow growth through the first half of the year and blaming uncertainty over a massive subsidy as a reason why. Alex Guillen of Politico reported last week that the United States added only 1.6 megawatts of wind power in the first half of 2013, which is far less than the 13 gigawatts installed last year and significantly smaller than the 3 gigawatts of new power installed over the first half of 2012.

The fact that the wind production experiences significant declines when the subsidy expires is not a good reason to extend it; in fact, it’s a good reason to permanently remove it.

The wind industry is confident that installation will pick up towards the end of year and that the uncertainty over the extension of the tax credit created the lag in production for the year. But what is most important, however, is just how dependent wind production is upon subsidies, as well as state mandates for renewable electricity generation.

Congress first passed the wind production tax credit (PTC) in 1992 but allowed it to expire several times. The PTC expired in 2000, 2002, and 2004, and annual wind installation decreased by 93 percent, 73 percent, and 77 percent, respectively. Wind energy advocates call this a boom-and-bust cycle created by unstable policy, but it is more likely a case of the wind PTC’s oversupplying a market and artificially propping up a large portion of wind production.

The complaint from wind advocates is that there’s no business certainty. While there may be uncertainty as to whether politicians cave and extend the PTC another year or two, the wind industry knew the expiration was coming for years. If they wanted policy certainty, they should have stopped lobbying for an extension.

Removing the energy subsidies would eradicate the near-term dependence but also promote long-term growth within the industry. The part of the wind industry that doesn’t depend on the PTC would be the more robust, competitive part and would provide consumers with affordable energy. Until the training wheels are taken off, however, the industry will not have the strongest incentive to innovate and lower costs to become economically viable and instead will concentrate efforts on lobbying for handouts.

Even Patrick Jenevein, CEO of the clean energy firm Tang Energy Group, affirmed in The Wall Street Journal the problems with his own industry’s dependence on subsidies:

Government subsidies to new wind farms have only made the industry less focused on reducing costs. In turn, the industry produces a product that isn’t as efficient or cheap as it might be if we focused less on working the political system and more on research and development.

The wind PTC is again set to expire at the end of the year. To provide certainty, save taxpayers billions of dollars, and promote healthy competition in the energy sector, Congress should let it expire and work to remove all energy subsidies for all sources.

Asked whether natural gas is important to the state's economy, 77 percent of Pennsylvania Democrats said it was somewhat or very important. Just 22 percent called it not very important or not important at all.

- survey taken by Muhlenberg College in Allentown, Pa. and the University of Michigan

"The flip side to appeasing the environmental lobby is that you open yourself up to getting roasted on killing jobs in Pennsylvania," said one Democrat working one of the campaigns.-------

(The point of fracking is that natural gas is a far cleaner and more efficient energy source for things like heating homes and powering manufacturing facilities than coal, oil. etc., not just a a gain of local drilling jobs.)

President Obama really should visit North Dakota and see for himself America’s energy revolution. A new report from IHS Global Insight highlights just how much impact unconventional oil and gas activity may be having on the US economy. For starters, it increased US disposable income by an average of $1,200 per US household in 2012 thanks to smaller energy bills as well as lower embedded energy costs in all other goods and services. IHS thinks that figure will to grow to just over $2,000 in 2015 and reach more than $3,500 in 2025.

Then there are the jobs:

The new study widens the breadth of the research to include the full energy value chain (upstream, midstream and downstream energy and energy-related chemicals) and the overall macroeconomic contributions on the manufacturing sector and broader U.S. economy. Midstream and downstream unconventional energy and energy-related chemicals activity currently support nearly 377,000 jobs throughout the economy, the study finds. Combined with upstream activity, the entire unconventional oil and gas value chain currently supports more than 2.1 million jobs. Total jobs supported by this value chain will rise to more than 3.3 million in 2020 and reach nearly 3.9 million by 2025.

Without the shale revolution, election year 2012 might have seen the official unemployment over 9% in November instead of 7.8%. And the average American would have faced a higher cost of living and lower income. More importantly now, the US energy industry continues to be a real economic bright spot.

OTTAWA--Canadian Prime Minister Stephen Harper has told U.S. President Barack Obama that he's ready to work on joint plan between the two countries to reduce carbon emissions in the energy sector in an effort to secure approval of the Keystone XL pipeline project, the Canadian Broadcasting Corp. reported Friday.

The CBC, citing unnamed sources, said Mr. Harper wrote to Mr. Obama in late August, signaling he is ready to accept carbon-reduction targets proposed by the U.S. and prepared to work with the White House to address concerns raised about Keystone and its impact on greenhouse-gas emissions.

A spokesman for Mr. Harper declined to comment on any correspondence between the Canadian and U.S. leaders. A White House spokesperson declined to confirm Mr. Obama had received Mr. Harper's letter.

TransCanada Corp.'s (TRP) proposed Keystone XL project, which would carry heavy crude from Alberta to the U.S. Gulf Coast, has sparked high-profile and vocal opposition from U.S. and Canadian environmentalists, who are concerned it will encourage to further development of the oil sands. The project is presently under review by the U.S. State Department, but ultimate approval rests with Mr. Obama -- who has said approval would hinge on the pipeline project's impact on greenhouse-gas emissions.

" it increased US disposable income by an average of $1,200 per US household in 2012 thanks to smaller energy bills as well as lower embedded energy costs in all other goods and services"---------------------------

I am always pleased to see the nation's leading newspaper pick up and run with the themes (previously) discussed here.

WSJ. REVIEW & OUTLOOK, September 9, 2013, 8:08 p.m. ET

More on Fracking and the PoorThe U.S. oil and gas boom added $1,200 to disposable income in 2012.

"The irony Washington will never appreciate is that fracking has done more for the less fortunate in the Obama years that all of its ministrations combined."

WSJTarget: Natural GasRon Binz calls it a 'dead end' technology, and he'll try to make it so.

The oil and gas fracking boom increased household disposable income by $1,200 last year as lower energy costs flowed to consumers, according to a new study from IHS Global Insight. So Americans may want to know that President Obama's nominee to chair the Federal Energy Regulatory Commission (FERC) thinks natural gas is a "dead end."

That nominee is Ron Binz, and in March 2013 he spoke at an Edison Foundation panel on utilities and green technologies. To fight global warming, he argued, government must adopt a "new regulatory model, because that's where it's going to start."

Duke Energy CEO Jim Rogers challenged him by noting that the 2009 Pelosi cap-and-trade bill hadn't passed, yet utilities have since cut carbon emissions sharply by switching to natural gas from coal. This shift is "an incredible example" of how "policy didn't get done, but at the end of the day technology produced the result. You seem to believe that this transition will only happen if it's driven by policy," Mr. Rogers asked.

"Well, natural gas is a good example," Mr. Binz replied, meaning of his policy preferences. "It's been called for many years a transition fuel. The industry has sort of jettisoned that label lately. It seems to be a permanent fuel. On a carbon basis you hit the wall in 2035 or so with gas. I mean, you do."

Enlarge ImageimageimageBloomberg

PacifiCorp Lake Side 2 natural gas power plant under construction in Vineyard, Utah

Mr. Binz said switching to gas might be "a good move" for the interim, "but we also need to understand that without CCS, without carbon capture and storage, I think that's a dead end, a relative dead end—it won't dead end until 2035 or so. But that's when we need to do better on carbon than even natural gas will allow us to do under current assumptions."

So there it is: Natural gas is a dead end not because there will be too little gas but because by 2035 it won't reduce carbon emissions as much as Mr. Binz wants.

Naturally, Mr. Binz's alternatives to gas are green "renewables" like wind and solar. Or so he said at a November 2012 forum at the University of Denver, citing research from the federal National Renewable Energy Laboratory. The 2012 study does show that the 80% scenario is theoretically possible, but only if the assumptions are wildly unrealistic. The lab assumes that gas as a share of the U.S. power mix could plunge to 3% by 2050 from 16% in 2010, and coal to 9% from 51%. Wind will climb to 39% from 2%, and solar from 0.01% to 7%.

Mr. Binz wants to make that happen, and don't worry about the costs of the transition. He said that this "renewable energy future was no more costly, or in the realm of the same cost, as any other clean technology. In other words, if you accept that we're going to have to make these reductions in carbon and in other criteria pollutants, renewables are not going to be more expensive as a total package than other proposals such as nuclear, such as carbon sequestration from coal and natural gas."

Note those words "we're going to have to make these reductions in carbon." This is a man whose overriding policy motivation is making carbon more expensive so it can be phased out of the U.S. economy.

In Denver, Mr. Binz also instructed the audience that "We're coming off an election where one of the themes was, we're all in this together. And I think that is the kind of message that needs to be stressed. One utility's exhalation of carbon dioxide is everybody's problem.

"This is not a situation where it's okay to be with a clean utility and it's okay to let other customers go their own way, because there's a commonality here. I think we need to keep preaching that. We have a bias toward individualism in this country, which can work for great things, but it can also at times prevent us from doing societal things, and there's really no substitute for doing that right now."

Such thinking ought to scare the daylights out of Senators from fossil-fuel states because it shows how Mr. Binz will operate at FERC. The supposedly independent agency oversees much of the gas business—from pipelines to export terminals to trading markets. It also has a narrow role to ensure that electricity is affordable and reliable, which Mr. Binz interprets to mean a mandate for whatever his carbon-free paradise requires.

Senators should also pay attention because Mr. Binz words are a rare public admission of what the green left really thinks about natural gas. Liberals loved gas when it was scarce and expensive. But now that it is abundant and cheap, gas poses a threat to the dream of an economy run solely on mandated renewables. So the strategy is to use regulation to slowly make natural gas more expensive again.

That will be Mr. Binz's job at FERC. In Denver he mused about the reasons some states use more renewables than others and "the answer I think to my own question is it's policy, it's regulation, it's industry structure and it's incentives we provide for this. It's not physics, it's not chemistry, it's not even the electric grid. It's what we decide we want."

More than 12 years ago, the Cheney task force made recommendations like: "repair and add onto the existing network of refineries, pipelines, generators and transmission lines. ...the refining and distribution of natural gas was effected by an inefficient and inadequate infrastructure, and that this issue could be remedied by 38,000 miles of new pipeline and 255,000 miles of distribution lines"

We mostly ignored that advice. Now we pay the price, in spite of all the increased production of oil via fracking.

The policy of keeping gas prices high is now intentional. Who does it hit worst? The working poor and struggling lower middle class who rely on it to get to work, do their work or look for work. Is that what we want? Maybe not, but is the result of our elections and policies.

In energy milestone, EQT in first-ever fracking job powered only by well gas • 2:11 PM •EQT Corp. (EQT +1.5%) and Green Field Energy say they completed the first fracking job powered solely by natural gas tapped from a nearby well, using well gas to complete jobs on a Marcellus shale well in Pennsylvania.•Some operators, including Apache (APA), have estimated that using well gas could cut fuel costs by 70%; APA has said that if all fracking jobs switched to well gas, energy companies could cut their industry-wide fuel costs by $1.67B.